How Much House Should I Buy?

If you've decided you're ready, you still need to decide how much mortgage you're willing to take on.

Again, this is not a decision you should put in the hands of your lender, your real estate agent, your family, or your friends. Chances are good none of these folks know what you can really afford. Your lender or agent may know every detail of your current financial life, for example, but they probably don't know when you want to retire, how many children you want to have, or how much you like to travel—all factors that influence how much of a mortgage you should take on.